Outlook for the Danish economy – Declining but still high inflation

Analysis - March 2023 - No. 4

Authors Danmarks Nationalbank
Subject Danish Economy; Current economic and monetary trends; Economic activity and employment; International Economy
Type Analysis
Year 2023
Published 15 March 2023
Abstract icon The significant tightening of monetary policy is helping to dampen inflation and take the pressure off the Danish economy. However, higher wage in-creases will sustain inflation in the coming years. Therefore, there is a need for a tight economic policy that does not add to inflation, and it is important that fiscal policy does not counter work monetary policy in bringing the inflation down. A tightening of fiscal policy may become relevant if the risk of a Danish wage-price spiral rises further.